Blogs & Comment

ETF explosion now going too far

NOW the explosion in exchange-traded funds (ETFs) has gone too far. I held off with this charge while others like John Bogle bemoaned the arrival of sector ETFs, intelligent ETFs, and other departures from broad-market ETFs. But as of this day, Im joining Bogle and other detractors of the ETF expansion.
According to, Harry Dent Jr. has launched an actively managed ETF called the AdvisorShares Dent Tactical ETF. It began trading Sept. 16 under the symbol DENTin the U.S.. Mr. Dent, as you may recall, is the serial soothsayer and author who uses demographic trends and other variables to predict economic booms and depressions to varied success.
“It’s not going to be limited in any way how much its managers can trade. And they won’t follow any index,” an executive associated with the ETF told The management expense ratio (MER) is close to 1.5%, about what mutual funds charge in the U.S. Dent’s ETFfunctions like an ETF of ETFs, i.e. Dent and co-managers will be trading ETFs.
The executive adds this about the portfolio management team: Theyre not fundamental and theyre not technical. Dent uses economic data such as spending habits and future earnings potential to identify the most appealing companies given specific demographic trends his team has identified,”
Actively managed? No restrictions on trading? No benchmark? MER like a mutual fund? Managed by a person with a forecasting track record suggestive of a random toss of the die? Need we saymore?